As Micron (MU.US) stock rebounds, the Taoyuan union plans to strike! AI memory chip deliveries face a test.

Just as Micron (MU.US), the U.S. memory chip manufacturing giant that had suffered consecutive days of stock price declines, rebounded in the U.S. stock market on Monday, a labor union organization representing Micron's employees in Taoyuan, Taiwan, China, said it would launch a strike on Thursday, synchronized with a mediation meeting between the U.S. memory chip manufacturer and another union representing employees at its Taichung plant, further escalating the dispute over employee bonuses. Although Micron is headquartered in the United States, its chip manufacturing plants in Taiwan, China, are crucial to Micron's total memory chip production capacity. It is understood that this strike further heats up the labor dispute at one of Micron's most important memory chip manufacturing bases. Micron produces DRAM and high-bandwidth memory (HBM) key memory chips on a large scale locally, both of which are key components for NVIDIA Corporation's Blackwell and Rubin architectures and even broader AI server clusters. Just after Micron's stock price joined the semiconductor sector's Monday counterattack in the U.S. stock market, its key manufacturing base faces new delivery uncertainty. Micron's Taoyuan union plans to launch a strike on Thursday, October 22, in support of the Taichung union, which is still negotiating with the company, and to demand that management propose a specific profit-sharing plan. Taiwan, China, is an important production base for Micron's DRAM and high-bandwidth memory (HBM) key chips, so the market is focused not only on bonus spending but also on whether the labor dispute will affect the production and delivery of AI memory products. Currently, the Taichung union has not yet held a strike vote, and the Taoyuan union has not announced the duration of the action, so there is no basis to conclude that the relevant production lines will be fully shut down. On Monday, Micron rose 2.97% to $904.90, outperforming the Philadelphia Semiconductor Index, which rose 1.61% that day, becoming an important force in driving the memory sector's rebound. However, the correction before the repair was quite severe: Micron fell about 14.59% last week and, as of Monday, had fallen about 15.04% in October, a drawdown of about 27.90% from its 52-week intraday high of $1,255; meanwhile, its year-to-date gain remains about 217%, showing a pattern of "substantial long-term gains with deep valuation compression." In pre-market trading on October 20, Micron's stock price fell about 2%. The recent selloff reflected the market's repricing of surging AI financing costs triggered by rising U.S. Treasury yields, increasingly blurred returns on AI capital expenditure, and Chinese memory chip manufacturers joining competition in the memory super cycle; Monday's rebound showed that funds are beginning to reassess profit value after the deep decline. This bonus dispute has once again drawn investors' attention back to the manufacturing side: whether strong demand and large orders can be fulfilled ultimately still depends on stable capacity operation and on-time product delivery. Bonus dispute escalates! Profit-sharing talks fail, Taoyuan union announces action The Taoyuan union said the strike is intended to support the Taichung union and increase pressure on Micron to demand that the company propose a specific profit-sharing plan. Micron employs about 15,000 people in Taiwan, and employees at the Taoyuan and Taichung plants are represented by different unions. The company previously said it has invested more than NT$1.6 trillion, equivalent to about $49 billion, in Taiwan. Mediation between Micron and the Taoyuan union ended in September without an agreement. The union obtained member authorization in early October to launch a strike. The Taichung union, which represents employees at Micron's largest plant in Taiwan, is still negotiating with the company. The union has not yet held a vote on whether to strike. The Taoyuan union did not say how long the sympathy strike would last and said it would announce more details on Thursday. In a statement on Monday, the Taoyuan union said: "Through action, we will make our dissatisfaction with the current system heard by the outside world and demonstrate our determination to establish a fair profit-sharing system." It is reported that government departments last week called on Micron and employees to negotiate "sincerely." Memory chip demand remains explosive, fulfillment capability becomes the focus: Wall Street's average target price for Micron is about 70% higher From a manufacturing mechanism perspective, the effective supply of HBM depends on coordination among DRAM wafer manufacturing, stacking and packaging, and testing. Continued impact on personnel and shift scheduling in any key link could extend production cycles and delay deliveries. Micron official information shows that the Taichung advanced packaging and testing facility undertakes important manufacturing tasks for HBM and DRAM products. Exactly which positions and how many production shifts the action initiated by the Taoyuan union will affect, and whether it will spread to other plants, will determine the actual operational impact. Tightening industry supply may support memory prices, but whether Micron itself can benefit still depends on deliverable volumes and production costs; the value of scarce supply must be converted into profit through stable shipments. What supports Wall Street's bullish stance is already-realized earnings growth and still-strong demand expectations. Micron announced on September 30 that revenue for the fourth quarter of fiscal 2026 reached $54.229 billion, compared with $11.315 billion in the same period a year earlier, up about 379% year over year; the company expects revenue for the first quarter of fiscal 2027 to reach $60 billion-$63 billion. Management also emphasized that strategic customer agreements strengthen the company's confidence in the sustainability of its financial performance. John Vinh, senior analyst at KeyBanc, noted after an Asia research trip on October 15 that data center and AI demand are driving a sustained memory shortage and estimated that DRAM prices would rise 15%-20% quarter over quarter in the fourth quarter and NAND about 20%; for HBM, KeyBanc forecast that blended HBM prices could rise sharply by 80%-100% in the first quarter of 2027. The analyst's latest judgment supports Micron's logic of continuing to expand profitability through product mix upgrades and price improvement. As of October 19, StockAnalysis, citing data from 49 analysts compiled by S&P Global, showed that Micron's consensus rating was "Strong Buy," with an average target price of about $1,561 over the next year, about 72.5% above Monday's closing price. Among them, Bank of America maintained a "Buy" rating and a $1,550 target price on October 15, implying about 71.3% potential upside; KeyBanc maintained a positive rating and a $1,750 target price, implying about 93.4%. These target prices reflect institutions' confidence in the sustainability of memory earnings, while the new pricing variable brought by this labor dispute is whether the company can maintain production continuity during a period of strong demand and fully convert price advantages into shipments, profit, and cash flow.